SC seeks AG’s help over FBR suggestions about dams fund

Updated February 28, 2019

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Amicus curiae says charges collected from mobile phone users can be deposited in the fund only with their consent.— AFP/File
Amicus curiae says charges collected from mobile phone users can be deposited in the fund only with their consent.— AFP/File

ISLAMABAD: The Supreme Court on Wednesday asked Attorney General Anwar Mansoor to get instructions from the government and assist the court regarding suggestions put forth by the Federal Board of Revenue (FBR) about diverting to the Diamer-Bhasha and Mohmand dams fund of certain charges on cellular phone cards and water extracted by mineral water companies.

FBR Chairman Mohammad Jehanzaib Khan submitted to the apex court a reply highlighting the imposition of certain levies by the government without any legislation.

Read: Editorial: Dam fund disappointment

“We will need assistance from the AG office before proceeding further,” observed Justice Sheikh Azmat Saeed while heading a five-judge SC implementation bench on the Diamer-Bhasha and Mohmand dams fund. “We expect AG to take instructions from the government and assist us,” Justice Saeed observed.

During the hearing, Dr Parvez Hassan, who was appointed amicus curiae along with Makhdoom Ali Khan, also furnished his submissions and said he had gone through the court order under which the dams fund was created and discovered certain constitutional minefields in it.

Amicus curiae says charges collected from mobile phone users can be deposited in the fund only with their express consent

Dr Hassan highlighted that the charges collected through mobile phone bills, which were suspended by the apex court on Oct 16, 2018, could only be deposited in the dams fund with the express consent of the mobile phone users from whom these amounts were illegally charged. He explained that the Supreme Court had in the 2013 Eng Iqbal Zafar Jhagra case ordered the refund of sales tax amounts illegally collected from CNG consumers.

The reply came in response to the apex court’s earlier query whether the amounts collected from mobile phone bills, which had been suspended by the court, could be collected as a special cess and made part of the donations towards the dams fund and other water management purposes.

Dr Hassan argued that illegal service charges/taxes collected from the mobile phone users could not be recovered and deposited in the fund meant for construction of dams and other projects since these were illegally charged, adding that such charges/taxes should be refunded to the cell phone users.

About the imposition of Rs1 per litre charge on the extraction of groundwater and use of surface water by mineral water and other beverages industries, Dr Hassan explained that since water was treated as a provincial subject under Article 142(c) of the Constitution, it would form part of the provincial consolidated fund of each province in terms of Article 118 of the Constitution.

Likewise, he added, the custody of the provincial consolidated fund, deposit of moneys in that fund, withdrawal of moneys, custody of other moneys received by or on behalf of the provincial government, their payments into and withdrawal from the public account of the province and all matters connected with or ancillary to the matters would also be regulated by the act of the provincial assembly.

“The amounts from a provincial consolidated fund can only be utilised through the procedure of passing an annual budget statement by the provincial assembly in terms of the procedure provided under Articles 120-125 of the Constitution. Therefore, the same cannot be deposited in the dams fund,” Dr Hassan said.

He argued that the custody of the dams fund so created could not in law remain with the Supreme Court or its registrar or with any of the judges of the apex court since its custody would lie only with the president and the finance ministry.

About the constitution of the dams fund by the Supreme Court under Article 184(3) of the Constitution, Dr Hassan said the apex court under the provision had the power to take cognisance of a matter of public importance with reference to the enforcement of any of the fundamental rights of the people of Pakistan under its original jurisdiction and pass orders for the enforcement of such fundamental rights.

Referring to a question whether the apex court could direct donations to the dams fund on the basis of a tax-free status with complete exemption from tax or scrutiny, Dr Hassan explained that these were the areas under legislative and executive actions and, therefore, should be respected. He said it would be best to move forward with the fund with the support of the legislature and the executive and where the law clearly provided for legislative and executive actions and the process and, therefore, these should be followed with minimalist judicial intervention.

The apex court observed that it would consider the report and explained that Dr Hassan had been called only for the purpose of detecting these minefields.

The court also ordered State Bank of Pakistan Governor Tariq Bajwa to dispatch next time a different executive director who should come up with a number of options on how to invest the donation of Rs9.8 billion for the two dams in the government treasury bills.

Earlier, a senior SPB representative told the court that the fund could be invested for three months and after the maturity it could be further floated on a better rate since the market would go up and “we will be able to roll up the money in a better way”.

But the court expressed its disappointment, explaining that it had never delegated the central bank the authority to decide investment in a particular instrument, rather it was the court which would finalise after evaluating the options put forth by the bank.

Pakistan Electronic Media Regulatory Authority Chairman Saleem Baig informed the court that the authority had issued strongly-worded show-cause notices to 16 television channels for running anti-dam campaign. He explained that the under television licence, it was mandatory for a private channel to dedicate 10 per cent of the total airtime for public interest messages for which no public amount was paid.

Similarly, Advocate Saad Rasool, representing the Water and Power Development Authority chairman, assured the court that Wapda would furnish a critical path method highlighting future line of action for the construction of Mohmand dam. He said that 844 acres of land had already been acquired for the immediate construction of the dam by allocating the money to be distributed among the people from whom the land had been acquired.

The case will be taken up on April 10.

Published in Dawn, February 28th, 2019